Photoreceptor deficit observed in uveitis derives in part from inability to control inflammatory responses in neuroretina. Recently, we showed that IL-27 plays a role in suppressing experimental autoimmune uveitis (EAU), an animal model that share essential pathological features of human uveitis. However, the mechanism by which IL-27 inhibits CNS inflammation is not clear. In this study we have investigated mechanisms by which IL-27 mitigates or curtails intraocular inflammation (uveitis) and examined whether inhibitory effects of IL-27 are mediated locally by neuroretinal cells or by regulatory T-cells. We show here that microglia cells in the neuroretina constitutively secrete IL-27 and its expression is upregulated during uveitis. We further show that photoreceptors constitutively express IL-27 receptor and respond to IL-27 signaling by producing anti-inflammatory molecules, IL-10 and SOCS1 through STAT1-dependent mechanisms. Moreover, STAT1-deficient mice produced reduced amounts of IL-27, IL-10, and SOCS1 and developed more severe uveitis. Surprisingly, IL-10-producing regulatory T-cells had marginal roles in suppressing uveitis. These results suggest that suppression of intraocular inflammation might be mediated through endogenous production of IL-27 and IL-10 by retinal cells, while SOCS proteins induced by IL-27 during uveitis may function to protect neuroretinal cells from toxic effects of proinflammatory cytokines. Thus, targeted delivery of IL-27 into immune privileged tissues of the CNS may be beneficial in the treatment of CNS inflammatory diseases, such as, uveitis and multiple sclerosis.